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Clear Channel Revises Indie Contract

July 21, 2007 Comments off

Here’s a great column by Susan Butler that tells it like it is regarding this whole tempest in a tea cup regarding Clear Channel’s independent music program. It’s hard to be sure exactly what was said to whom when, but it sounds like FMC went crying to the FCC with some facacta claim that somehow there was payola–yes payola–in the house because Clear Channel was (according to FMC) trying to trick independent artists into giving up their statutory royalties in exchange for getting played in Clear Channel’s most recent independent artist program.

FMC is so desparate to get into the act that they went running off to poor Senator Feingold with this tall tale questioning Clear Channel’s motives–evidently without ever talking to Clear Channel. Of course, in the digital age one should not be surprised by this “head in the sand” approach (no doubt inspired by whacky interpretations of the DMCA.)

I wonder what they told Feingold’s staff and which Feingold staffer was stupid enough to let the boss go off half cocked in public without checking the facts. (I’m sure they’re just lining up to take credit for that bungle in the jungle.)

Now I have my problems with Clear Channel and with radio in general in this country. But I’m also mindful that Clear Channel has backed A&R Worldwide for many years (including their International Passport radio show), and those guys have done more to introduce people to new music and help bands get signed than all the taxi.com’s in the known universe. Certainly more than FMC has. Clear Channel deserved an opportunity to respond before anyone started filing petitions with the FCC.

This whole thing was about how the artist agreement was drafted for one of Clear Channel’s programs supporting independent music. Whoever drafted it didn’t clarify that while Clear Channel got the work on a royalty free basis, they weren’t asking artists to waive any statutory rights.

The brouhaha actually highlights how much working lawyers have to think about in our new world of digital music, and emphasizes how likely you are to find your head on a pike by some people you’ve never heard of who don’t have the courtesy to call you before they go off on an attention-starved rage on Capitol Hill.

I’d also point out another thing in the subtext of all this: “No good deed goes unpunished”. Next time maybe the Clear Channels of this world won’t bother trying to help independent music if the thanks they get is something they’ve never heard of called FMC going running to Hill staff who don’t check the facts when they get information over the transom.

Hopefully everyone on Capitol Hill will be more careful about who they believe without checking the facts first.

And here’s another little tip: If the participating Clear Channel stations were already simulcasting and reporting to SoundExchange, in order for them to do what Li’l Jenny says they were planning on doing, someone would have to spend the time to reach into the accounting system and CHANGE the reporting on a PER ARTIST basis which would very likely cost MORE than it would have to just leave it alone and let people get their few mils per play.

Here’s a tip for Li’l Jenny: You see, payola is where you say shall I send that plasma TV to your home or office address, and not shall I burden your accounting staff with stupid human tricks.

As usual with the anti-copyright crowd, no issue to small to screw up.

Originally Posted On Jul 20, 2007 8:35 AM ET http://www.radioandrecords.com/

Clear Channel Revises Indie Contract
By Susan Butler, Billboard

SOURCE: Billboard.biz

Clear Channel has revised its online agreement for indie artists and labels who want to upload their music to be considered for broadcast and digital downloading. The agreement, which came under the spotlight when the American Assn. of Independent Music (A2IM) e-mailed its members urging them not to sign the license, was interpreted as waiving artists’ and labels’ right to receive royalties.

A Washington, D.C.-based group, the Future of Music Coalition (FMC), began a press campaign condemning the license — and claiming that Clear Channel was in violation of a settlement agreement reached after an investigation of alleged payola. The group also filed a petition with the FCC on the issue. The press coverage prompted Sen. Russ Feingold, D-Wis., to send a letter to Clear Channel, questioning the move, according to the senator’s press release. However, the FMC has never contacted Clear Channel directly to discuss this issue, an FMC spokesman said in an e-mail to Billboard.biz yesterday (July 19).

Clear Channel had been contacted directly by the American Assn. of Independent Music (A2IM) and the Recording Artists Coalition (RAC), before the FMC press campaign began, to negotiate a change in the license, say sources close to the negotiations. The sources also state that the terms of the original agreement were likely drafted by an “overzealous lawyer” who drafted the provisions too broadly. A2IM and RAC have been working with Clear Channel on acceptable, revised contract language, according to a letter being sent by the three parties to the FCC and obtained by Billboard.biz.

According to the letter signed on behalf of Clear Channel, A2IM and RAC, “the revised license will offer three options for an artist or independent label to submit their music for consideration and possible airplay. They can choose to submit their music for: 1) terrestrial radio broadcast and Internet radio simulcast; 2) on-demand streaming; or 3) digital downloading. All statutory royalties established now or in the future will be paid for terrestrial radio broadcast to the respective performing rights organization, and for Internet radio simulcast through SoundExchange (Option 1). Only public performance royalties to songwriters and publishers will be paid for on-demand streaming (Option 2). Royalties will be waived for digital downloading (Option 3). The licenses will be non-exclusive and can be terminated at any time.” The letter goes on to explain, “under Option 1, there is no option to waive any statutory royalties for terrestrial radio broadcast and/or Internet radio simulcast.

Thus, there can be no claim that an artist is waiving a royalty in exchange for radio airplay. Recording artists will also have the right to choose whether or not to allow for on-demand streaming and digital downloading of their sound recordings without the payment of royalties (except for the public performance royalties paid to songwriters and publishers for on-demand streaming).

This allows recording artists the choice of giving away their music as a promotional tool, or not, and the choice to revoke the license for any reason, at any time.”

In an unusual press release e-mailed late Thursday (July 19), the FMC appeared to take sole credit for the change. “The move comes after a week of intense pressure from the Future of Music Coalition, which launched a campaign on July 9 to end the requirement. The capitulation is a major victory for the small non-profit organization… It also is a story of how a small non-profit organization beat back the nation’s largest and most powerful radio broadcaster.” Andy Levin, Clear Channel executive VP/chief legal officer, said in a statement: “This is a perfect example of no good deed goes unpunished. We never had any intention of not paying licensing fees for radio air play or for online streaming of simulcast programs. RAC and A2IM brought to our attention that the licensing agreement could have been construed otherwise, so we clarified it well before FMC filed its misleading and misinformed petition. FMC’s allegations of a ‘payola-like scheme’ are irresponsible and totally false.”

After FMC’s press release yesterday, in response to an e-mail from Billboard.biz, the FMC stated that “A2IM had a role in [resolving] this.” In a document provided with that e-mail entitled “Clear Channel Blow by Blow,” it states in part: “It is important to note that FMC is the only artist organization that identified, promoted and fought against this egregious overreach by Clear Channel.”

This statement is contrary to the letter sent to the FCC and Clear Channel’s statement. It is unclear from the FMC Web site specifically who the group represents — how many of the group’s “artist” members are professional artists and musicians who earn their living from their music, how many are not yet professionals and how many are hobbyists; the group’s advisors listed on the site include Stanford Law School professor Lawrence Lessig, who signed an amicus (friend of the court) brief filed with the U.S. Supreme Court in the historical MGM Studios vs. Grokster.

His brief, filed on behalf of Creative Commons, opposed the position taken by the entertainment industry parties in their fight against P2P services Grokster and Morpheus. He argued at the time that the services should not be liable for secondary copyright infringement. The Supreme Court ruled in favor of the entertainment industry parties.

According to the RAC Web site, the group represents dozens of professional artists and musicians listed by name on their site.

© 2007 Radio & Records (R&R). All rights reserved.

Things that make you go hmmmm….

July 13, 2007 2 comments

I noticed in a recent amicus brief filed by both the Electronic Frontier Foundation and by Public Knowlege the two organizations described themselves and ended the description with these two lines I quote in juxtaposition:

“EFF has no parent companies, subsidiaries or affiliates. No publicly held corporation has an ownership stake of 10% or more in EFF.”

“Public Knowlege has no parent companies, subsidiaries or affiliates. No publicly held corporation has an ownership stake in Public Knowledge.”

Hmmm….”No publicly held corporation has an ownership stake of 10% or more in EFF.”

Isn’t that fascinating.

So which publicly held corporation has an ownership stake of less than 10% in EFF?

Oh, gee whiz. Who would hazard a guess on that one.

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